Aluminium plunges amid weakened Chinese coal prices
ALUMINIUM TUM BLED TOWARDS TWOMONTH LOWS Friday as retreating coal prices eased concerns over supplies in leading producer China, where coal-fired power is a major ingredient in the metal’s production process.
Benchmark aluminium on the London Metal Exchange (LME) slipped 1.9 per cent at $2,693 a tonne in official rings, having hit its lowest since late August at $2,602 per tonne the previous day.
Duncan Hobbs, research manager at Uk metal trading firm, Concord Resources, noted that a shortage of magnesium, which is used to make aluminium alloys for the auto and construction industries weighed on the metal
Hobbs said the magnesium shortage may undermine downstream demand for aluminium, adding that aluminium prices will have to trade at higher levels on average in years to come to incentivise production outside China.
Meanwhile, copper prices declined 0.5 per cent at $9,615 per tonne but maintained its course towards its best month since April, having hit $10,452.50 a tonne in early October, the highest level since May 18.
Analysts said gains have been fuelled by falling stocks in LMEregistered warehouses, which are down 45 per cent since August at 140,175 tonnes.
For other base metals, Zinc lost 1.1 per cent at $3,335 a tonne, lead slipped 0 9 per cent at $2 401 a tonne, nickel declined 1.4 per cent at $19,300 a tonne, while tin maintained bullish sentiment, rising 3.1 per cent to $36,950 a tonne as market focus returned to shortages of the soldering metal with LME stocks at 680 tonnes, the lowest since 1989